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Two other companies are also involved in the complicated transaction. The Imperial Tobacco Group will pay $7.1 billion for several brands — including Kool, Salem and Winston cigarettes, and Blu e-cigarettes — and acquire a former Lorillard manufacturing plant that employs about 2,900 people in Greensboro, N.C.

And British American Tobacco, which owns 42 percent of Reynolds, will spend about $4.7 billion to buy additional shares to maintain that level of ownership in the combined company and help finance the deal.

Analysts have said the four-way transaction could spur other mergers in the industry, particularly as established manufacturers seek to gain ground in e-cigarettes.

The long-awaited combination, over a year in the making, will reshape America's tobacco industry as companies grapple with a decades-long dropoff in smoking. Buying Lorillard will make Reynolds a stronger competitor to the Altria Group, whose Marlboro brand alone accounts for nearly half of all cigarette sales in the United States.

Perhaps more important, the deal will also give Reynolds a foothold in one of the fastest-growing products in the industry: menthols. Lorillard owns Newport, the bestselling brand of menthols, which represents roughly 12 percent of the overall cigarette market.

The combined company's flagship brands also will include Camel, Pall Mall and Natural American Spirit cigarettes, and Grizzly smokeless tobacco. And the sale of some brands to Imperial, whose offerings include Galouises, will make it the third-biggest cigarette maker in the United States.

"This is a great opportunity to transform our U.S. business and secure a significant presence in the world's largest accessible profit pool," Imperial Tobacco chief executive Alison Cooper said in a statement.

The deal is subject to regulatory and shareholder approval and is expected to be completed in the first half of 2015.